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Xoom to Transform Money Transfer Industry with New Wholesale Product, $15 Million Financing and Senior Staff

Xoom's WebAgent makes it easy for others to build remittance businesses by taking care of the logistical, technological and legal complexities

SAN FRANCISCO--(BUSINESS WIRE)--June 19, 2006--Xoom, the money transfer innovator, today announced its new turn-key solution, Xoom WebAgent. With WebAgent, banks, credit unions, retailers and money transfer operators can build or expand their money transfer business without worrying about the complex logistical, technical and legal hurdles associated with operating a remittance business.

"Xoom takes care of all of the potential headaches," said Xoom CEO James Joaquin. "Our partners can quickly build or expand their money transfer business because we've already set up large and reliable disbursement networks overseas, deployed secure technology, and complied with the myriad of banking and anti-money laundering regulations," said Joaquin. "With Xoom WebAgent, we put the marketing power into our partners' hands by giving them control of branding and pricing, so they best meet the needs of their own customers." Among the first companies to sign up for Xoom Web Agent are MetaBank, Equitable PCI Bank's Express Padala, Chequepoint and Victoria Mutual Money Transfer Services.

MetaBank launches Xoom-powered remittance service

One of the first companies to take advantage of Xoom's new turn-key solution and network is the Midwestern bank MetaBank. Earlier this year, Mick Conlin, vice president at MetaBank's Meta Payment Systems® Division, was visiting a bank branch in Storm Lake, Iowa educating the staff about the innovative services his division offers. One of his team's roles, he explained, is anticipating people's banking needs, and creating new products for MetaBank. During the visit, a branch employee mentioned that every payday there were long lines of immigrants, all workers from the local meat packing plants, who came to the branch to cash their paychecks and then proceeded to the nearest money transfer operator to send money to relatives in other countries. The employee wondered how MetaBank could keep the workers' business.

Conlin knew that building a remittance service from scratch would be too time-consuming and costly. "We decided to partner with Xoom because of its track record with its own money transfer service. We knew it had an extensive international disbursement network, innovative and secure technology, and knowledge of how to navigate the often daunting regulatory compliance issues," said Conlin. "They even had the experience and capabilities to help us figure out how to market the service to this segment of the Storm Lake community."

Within weeks of signing a contract with Xoom, a pilot remittance program was underway in Storm Lake using Xoom's Internet-based WebAgent solution. Working closely with Xoom, Meta Payment Systems was able to launch the service in other MetaBank branches with a targeted marketing campaign to attract both new and existing customers. Inspired by the success of the implementation, Meta Payment Systems is planning to introduce the global money transfer service to other MetaBank branches and make the service available to other financial institutions and retail outlets.

Xoom Ready to Shake Up the Competitive Landscape

To aid in its transformation of the money transfer market, Xoom recently raised $15 million in venture capital. This latest round is led by Boston-based Fidelity Ventures, who joins previous venture capital firms Sequoia Capital, New Enterprise Associates and SVB Capital.

Spearheading Xoom's business development efforts is new senior vice president Gene Gutierrez, an ex-senior banker who helped build the global remittance division at Wells Fargo. "Xoom may well transform the industry landscape by helping the market's 'Davids' take on the industry's 'Goliaths'. I had to jump at the opportunity to work at Xoom," said Gutierrez. "Xoom's turn-key global remittance service is the first of its kind. Retailers and financial services companies can now launch new money transfer services in record time while remaining in control of branding and pricing."

Gutierrez joins an already strong management team, led by seasoned entrepreneur James Joaquin, who previously co-founded Ofoto (now part of Kodak) and When.com (now part of AOL).

About the Market for Remittance Services

By managing the complex distribution, technology and compliance requirements associated with global money transfer, turnkey solutions can level the playing field for retailers and banks alike, which have historically lacked the risk appetite and resources to participate in a global remittance market quickly approaching $300 billion," said Dan Schatt, senior analyst at Celent. "New players that adopt such platforms can also concentrate less on developing a distribution network and regulatory compliant software and more time on increasing customer satisfaction."

The international money transfer business has been one of the greatest beneficiaries of immigrant population growth. The free movement of people has resulted in $250 billion in remittances in 2005, and this figure is expected to grow 10 percent per year over the foreseeable future. Mexican immigrants alone send approximately $20 billion of their earnings to Mexico annually. The remittance market is very fragmented, however, with the biggest players, Western Union and Moneygram, accounting for less than 20 percent of the global market. (Source:CELENT)

About Xoom

Based in San Francisco, Calif., Xoom has been operating a successful money transfer service since 2002. Consumers from all around the world use its disbursement network to send money to dozens of countries in the Americas, Africa, Asia, Europe, and the Middle East.

In addition to operating its own remittance service, Xoom is transforming the industry by making it easier for companies to build or expand their own international money transfer business. By taking care of the compliance, technology and distribution issues that make remittances so complex, Xoom helps regional banks compete with national players when it comes to acquiring and cross-selling to immigrant customers, perhaps the fastest growing segment of the U.S. Xoom's turnkey solution and network also help independent money transfer companies add additional locations or corridors and retailers increase traffic to their stores.